The Portland daily press., 1887-12-03

points OF Jne law, Lne bank Examiner WOuAo
call particular attention to the following.
The question has been raised In regard TO
paying a stipulated rate Of interest upon adj
Yances. Although under the general powers
Of corporations this would be warranted, IL
does not come within the purview Of loan
and building associations. organized under
special laws and with special powers. The
law allows no discrimination between share
holders, but all shall be subject alike to q
pro rata division Of the profits. Although
the law remains silent on the subject Of ad-
vances, yet, as 1t has been the custom to re-
ceive them both In this State and Massachu-
setts, and as they would seem to come with
In the general scope and purpose OF loan and
building associations, the Bank Examiner
would rule that they may be received, sub
lect to such a per cent OF the dividends as
would be equitable.
In regard 10 the distribution Of profits, the
Bank Examiner understands from the law
that no dividend shall be paid to a share
holder in cash, but shall be credited to his
account. The dividend thus enhances the
value Of each share and hastens the time Of
It's maturity. The law does not contemplate
the payment Of shares by installments.
Profits shall be distributed TO the various
shares In proportion 20 their actual value ut
the time OF such distribution.
And shall be computed upon the basis OF
a single share fully paid at the date OF dis
tribution." By this expression the Bank
Examiner understands that a single share,
fully paid, shall form the unit upon which
dividends shall be reckOned.
To illustrate, an association declares
dividend OF 50 per paid up share. Then the
dividend OF share, whose value Is $40,
would be 10000 of So, or $3.50; II $50, the
dividend would be 60200 Of 50, or s1.5o
BY the provision ''l0sses shall be appor-
toned Immediately after their occurrence"
the law does not seem TO contemplate that
each individual loss shall be charged imme-
diately TO each share, but that an apportion-
ment shall be made In order that In case OF
the withdrawal OF any share, q proportion
ate amount of such unadjusted loss may be
deducted from the value Of such share. All
losses should finally be charged TO the profit
and loss account, or TO the guaranty account
OF the ten building associations now In
operation In this state. six have been organ
lied during the current year.
The present number Of shareholders Is
1851, Of whom about 146 are borrowers.
The amount Of dues collected Is s66,092;
the total amount Of resources. s93,613.SO;
The number Of loans outstanding Is about
100; the amount, S87, ,54S.76.
The number of new homes built through
their aid and now occupied Is nearly 100. and
a number are now In process OF erection.
But this by no means covers the range OF
work which these associations are doing.
Not only do they aid In building new homes
but also In buying old ones. In number oi
cases old mortgages have been paid OF and
renewed in an association to the material
benefit Of the mortgagor. Additions and i'm
prOvements to homes already paid for have
also been made through their aid.
Another hardly less Important use 70
which they may be put Is the building or
purchase Of stores and shops for small
tradesmen and mechanics.
The different associations have been able
10 pay fair dividend on their shares, one
The cost Of the houses erected average be-
tween al 900 and 81 GOO
A large majority Of the members OF these
associations are mechanics and small trades
men, Of whom large per cent. are young
men, and also include fair number OF
women.
Loan and building associations. like all
other institutions, can only flourish under
felicitOus conditions. Experience seems 10
have shown that rural districts and small
towns are not favorable to their develop
ment. Manufacturing and growing l0cali-
ties, where there are numbers Of working
men, constant employment and steady
wages. seem best adapted to their demands.
But they will conform to the wants and con-
ditions Of this place In which they may Dc
located.
A building association is not necessarily
intended, like savings bank, TO be per-
petual, but only to do q work needing 10 pc
done, and that done, its purpose Is accom-
plished. No better Illustration OF the
healthy growth and natural decline OF a
our own State. When the Peoples Loan
and Building Association was organized In
1875, Richmond had great shipbuilding IN
dustry. which gave constant employment
and steady wages TO many men. since tnen
that industry has declined. and the growth
of the town has been retarded. During the
twelve years that this association has exist
ed It has aided in building nearly sixty
homes. Having done this work, and having
provided all the new homes which the popu-
latlon Of the town demanded, II ceased %
grow.
The uniform success Of building associa.
tions wherever established under favorable
conditions, is a striking exposition Of the
power Of small earnings when united and
intelligently devoted to single object. II
points out the fact that sound business prin
ciples. wise management and executive abil
ity not only can, but do, exist among a elias:
who are generally regarded as being comPar
atively deficient In those important qualihea
tions and IL goes far toward establishing
the soundness OF cooperative principles
There has also been observed In these asso.
Citations public benefit far too important to
be overlooked.
A home more than any other thing adds tC
a mans social position and self-respect.. II
it imposes upon him the burden Of taxation
it also adds to his dignity as citizen. The
necessity Of intelligence and economy In
public affairs, and the maintenance OF Law
|
traordinary force. 1t teaches him TO con
slider carefully and act moderately. Unde
such a condition the danger Of strikes anC
and socialistic tendencies rapidly recede'
and feeling Of public security takes 1t.
place. Economy and thrift are cultivated
and sound and healthy public feeling L
| generated.
A DEFALcATIoN.
On the 29th day of August Frank G. Me
49, 10 81 MI raA
clerk in the Saco and Biddeford Savings In
stitution, disappeared, carrying with hin
$4,000 par value Of negotiable bonds an'
| $500 In currency.
A thorough and exhaustive examination
was Immediately made Of the affairs OF tn
Institution.
Public notice was given to holders OF de
pOsit books TO present them for verihcatioI
with the books OF the Savings Institution
and in the four weeks occupied by the In
vestigation. some two thousand pass book
were examined. trial balance was ais
made Of the "depositors' ledgers" and tn
general ledger account.
While the bank sustains large loss, 10 wa
| found that 1t. still had surplus above LA
| bilites Of S464, ,942.24. Ii Is today one Of thl
strongest hduciary institutions In New Eng
land.
INVESTMENTS.
During the past two years a large amoun
| Of bonds have been issued by corporation:
| of this State, a portion Of which have beer
| acquired by the saving banks, while the
market for these bonds Is confined to com
| paratively narrow limits, knowledge o.
| the liabilities of stockholders, the value o.
| the property and franchises on which the,
| are based, can be so readily obtained and thu
| fact that they are not subject 20 the widl
| huctuatiOn Of some otherwise eligible secur
| titles which are better known and have
| broader market, entities them to considera
| tion as savings banks Investment
During the year all the bonds Of the Cit,
| of Evansville, Ind. held by the banks an
| marked ''in default" at the first semei-annua
i examination, have been refunded and bon
/ bearing lower rate OF interest," which seem
| likely 10 be paid, has been substituted.
An Indiana Gravel Road case, recent
| decided by the Supreme Court Of that STATE
| was bought by farmer in Grant County
who resisted the tax for gravel roads, o
/ the ground that the bonds for which the as
/ sessments were made were In excess OF tn
two per cent limitation. and consequently
| void.
| In passing upon the questions raised, th
court decided that the gravel roads II
/ question.
"Dld not and do not constitute an indeptednes
| incurred by said county, within the Inhibition Z
/ article l3 OF our state Constitution. Such bond
are not payable by the County, or out Of the ger
i eral funds Of the county treasury. They are pa,
able out Of the particular fund TO be raised by IN
/ collection OF the assessments made on lands AZ
manner as to meet the payment Of principal an
| interest OF such bonds and placed as divided upo
| the ta& duplicates against the lands assessed -
mo other provision was made by law for I'll